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8. Purchasing
By-law Amendment: Conflict of
Interest Obligations for Consultants working on the same project for both the
City and the developer Modification au Règlement sur les achats : Conflit d’intérêt Obligations pour les experts-conseils travaillant
sur le même projet à la fois pour la Ville et le promoteur |
Committee Recommendation
That Council approve that By-law No. 50 of 2000, the Purchasing By-law, be amended in the form contained in Document 1 to ensure that obligations related to a conflict of interest are imposed on all external consultants providing services to the City.
Recommandation du comité
Que le Conseil approuve de modifier
le Règlement no 50 de 2000, le Règlement sur les achats, de la
manière indiquée dans le Document 1 afin de garantir que les obligations
relatives à un conflit d’intérêt soit imposées à tous les experts-conseils
externes offrant des services à la Ville..
Documentation
1. City
Treasurer’s report
dated July 16 2008 (ACS2008-CMR-FIN-0036).
Corporate
Services and Economic Development Committee
Comité des services organisationnels et du développement économique
and Council / et au Conseil
July 16 2008 / le 16 juillet 2008
Submitted by/Soumis par : Marian Simulik, City
Treasurer, Trésorière municipale
Contact Person/Personne ressource : Phil Andrews, Manager, Supply/Gestionnaire,
Approvisionnement
Financial Services/Services
financiers
(613) 580-2424 x 25176,
phil.andrews@ottawa.ca
That the
Corporate Services and Economic Development Committee recommend to Council that
By-law No. 50 of 2000, the Purchasing By-law, be amended in the form contained
in Document 1 to ensure that obligations related to a conflict of interest are
imposed on all external consultants providing services to the City.
RECOMMANDATION DU RAPPORT
Que le Comité des services organisationnels et
du développement économique recommande au Conseil de modifier le Règlement no
50 de 2000, le Règlement sur les achats, de la manière indiquée dans le
Document 1 afin de garantir que les obligations relatives à un conflit
d’intérêt soit imposées à tous les experts-conseils externes offrant des
services à la Ville.
In the 2007 Audit of Carp River Watershed Study and Related Projects, the Auditor General recommended:
“Recommendation # 12:
That the City ensure that consultants not be allowed to work on the same project for the City and for the developers, even if the City is fully aware of the fact. This recommendation applies even if the initial assignment is complete.”
Management supported this recommendation in principle, and this report proposes an amendment to the Purchasing By-law to ensure that certain obligations related to a conflict of interest are imposed on all external consultants.
While management agreed with the recommendation, it also pointed out that:
(1) The Professional Engineers Code of Ethics permits a professional engineer to work for two different employers as long as both employers are aware of this issue, however the Code also recognizes that the engineer’s duty to the public welfare is “paramount”.
(2) Strict adherence to the Auditor General’s recommendation:
(a) would reduce the available number of firms competing for City projects because some firms have worked for developers on the same project in the past or do not wish to be precluded from working with these developers in the future.
(b) may increase the cost of an assignment because if the City is not able to hire a firm that had worked for a developer on a past City project, it would be obliged to hire a firm that is starting new, with associated “learning curve”.
(c) may mean the City can not partner with the “best” in the business because it may have to hire a new and potentially less experienced firm.
Management concurred that in most cases it is preferable to have a consultant that has not and will not work for a different employer on the same City project, however due to the restrictions outlined above some flexibility is considered desirable.
Since 2005, staff in the Purchasing Unit have imposed the following condition of award related to Conflict of Interest obligations on all external consultants providing service to the City:
Conflict of Interest
(a)
Neither the Consultant nor any person, firm or
corporation associated or affiliated with or subsidiary to the Consultant shall
tender for the construction of a project, or have an interest either directly or
indirectly in the construction of a project that arises from the Services
provided as a result of this contract, without the prior written consent of the
City.
(b)
The
Consultant is required to disclose to the City, prior to accepting this
assignment, any potential conflict of interest.
(c)
If
a conflict of interest exists, the City may, in its discretion, either withhold
this assignment from the Consultant until the matter is resolved to the
satisfaction of the City, or award the assignment to another Consultant.
(d) The Consultant acknowledges and agrees that he/she/it shall not act, work or provide services, directly or indirectly, for, or to, another person, or persons, partnership, corporation, association or organization whose interests are in any way adverse, or contrary (in the opinion of the City of Ottawa), to those of the City of Ottawa with regard to the project for which the consultant was retained by the City. In the event of a breach of this obligation by the consultant he/she/it shall be responsible for all costs incurred or suffered by the City, including legal costs on a solicitor and client basis.
Both the Supply Management Division and the City Legal Branch drafted the above condition of award and consultants must accept this term in writing in advance of the City authorizing the contract. However, to date this approach has been procedural only, as opposed to being formally recognized within the Purchasing By-law.
In order, therefore, to formalize the above outlined process, staff recommends amending By-Law 50 of 2000, Purchasing By-law as outlined in document 1.
CONSULTATION
There has been no public consultation regarding this item.
FINANCIAL IMPLICATIONS
There are no financial implications as a result of this report.
Document 1 – Draft By law outlining amendments to the Purchasing By-law, No. 50 of 2000
STRATEGIC DIRECTIONS
Not applicable
DISPOSITION
Subject to Council approval, the City Solicitor will place the amended by-law on the Agenda of Council for enactment by City Council.
Document 1
A by-law of the City of
Ottawa to amend By-law No. 50 of 2000 with respect to the purchasing of goods,
services and construction for the City of Ottawa.
The Council of the City of Ottawa enacts as follows:
1. By-law No. 50
of 2000 entitled “Being a By-law respecting the purchasing of goods, services
and construction for the City of Ottawa”, as amended, is amended by adding the
following heading and section thereto immediately after Section 41
CONFLICT OF INTEREST
42. (1) No
person shall provide Consulting Services or Professional Services to both the
City and a private sector developer on the same or related project where, in
the opinion of the City, the commitment or professional duty of the person
providing such Consulting Services or Professional Services is compromised or
there is a perception that such commitment or professional duty may be
compromised. Commitment or professional
duty is or may be compromised, if, in the sole
opinion of the City of Ottawa, the
interests of the private sector developer are in any way adverse, or contrary,
or appear to be adverse or contrary to those of the City of Ottawa with regard
to the project for which the person was retained by the City.
(2) Despite subsection (1), where the City, after evaluating its options for
obtaining Consulting Services or Professional Services, wishes to contract for
Consulting Services or Professional Services with a person providing such
Services to a private sector developer on the same or a related project, the
written approval of the Deputy City Manager or, in the absence of the
applicable Deputy City Manager, the City Manager is required before awarding a
Contract.
ENACTED AND PASSED this day of , 2008
CITY CLERK MAYOR